'High Inflation Holiday' Consumers and Merchants Sigh... Simplification Trend Continues for This Year's Seol

Cost of Seollal Table Increases ↑ Small Business Sentiment Declines ↓
Seollal Table Costs Up More Than 5% Compared to Last Year

Kim Hyun-hee (35, pseudonym), a housewife living in Yeonsu-gu, Incheon, is already overwhelmed with worries ahead of this year's Lunar New Year. She faces significant expenses not only for the ceremonial table setting but also for gifts for relatives and acquaintances. With prices soaring and loan interest rates doubling, financial concerns are at the forefront. Kim said, "Since getting married, I have held the ancestral rites every year, but it seems to get harder with each passing year," adding, "Both my husband and I have seen our performance bonuses and bonuses decrease compared to last year, but expenses have increased, making it overwhelming."

Yoon Hyun-woo (37, pseudonym), an office worker living in Anyang, Gyeonggi Province, has decided to keep the holiday simple. He reached an agreement with his family not to gather during the holiday and instead plans to take a short trip with his children toward the end of the holiday. Gifts will be sent via delivery or expressed through online gift certificates.

With the Lunar New Year holiday just ten days away, soaring prices are deepening the sighs of ordinary people. Consumers worry about increased spending on ceremonial table costs and gift sets, while self-employed business owners are struggling amid the economic downturn.

According to Korea Price Information on the 12th, due to price increases in vegetables, meat, and processed foods, the cost of the Lunar New Year ceremonial table this year is expected to rise by more than 5% compared to last year. The Korea Price Association surveyed prices of 29 ceremonial items, including fruits, nuts, and vegetables, at eight traditional markets in six major cities nationwide, including Seoul, Incheon, and Busan, from the 5th to 6th. They reported that the cost of the Lunar New Year ceremonial table for a family of four was 254,300 won. This is a 5.8% (14,010 won) increase from last year's cost of 240,290 won.

Amid the ongoing high inflation since last year, ordinary people are making many efforts to reduce spending as much as possible. The burden of expenses during holidays has increased. In addition to food and daily necessities, electricity bills, gas fees, and loan interest rates have also risen, making the self-deprecating phrase "everything except salary is rising" a reality. Many have chosen not to hold holiday gatherings at all or to meet only with immediate family for simple meals, making the Lunar New Year more modest. Simplifying the holiday table setting has also become a trend. As ingredient prices rise, more people are opting for ready-made holiday home meal kits rather than cooking themselves. They prefer to reduce the hassle even if the cost is similar.

Self-employed business owners are not welcoming this situation. Expectations for the usual New Year’s sales boost have diminished this year. Small business owners handling ceremonial goods and restaurant operators are anxious about the shrinking consumption. According to the Small Enterprise and Market Service, the Small Business Sentiment Index (BSI) in December last year was 56.5, down 0.5 points from the previous month, marking a decline for three consecutive months. Small business owners cited poor economic conditions (48.7%) as the main reason for worsening sentiment (multiple responses allowed), followed by rising prices and interest rates (21.9%) and decreased foot traffic (20.4%). The traditional market BSI also fell for three consecutive months, dropping 4.0 points to 54.0 in December last year compared to the previous month.

Kim Jin-kyu (62, pseudonym), who runs a fruit shop in Yeongdeungpo-gu, Seoul, lamented, "The two holidays each year are the biggest sales periods, but compared to before COVID-19, order volumes are less than half of usual," adding, "Everyone seems to feel the high inflation, and customers are gradually closing their wallets."